In the short run firms may not increase their profits because the cuts in prices but if they achieve this in long run they may experience maxim profits. However the directors try to imply polices which do not always maximize the profits their objective is to satisfy the owners by getting some profit and growing the company in order to receive bigger market share to influence prices and quantity produced. I think that the managers should firstly try to grow the company and work for normal profit and maybe in long run obtain super normal profits. In short run they try to achieve lots of other objectives regardless profit
This would increase the costs and result in the firms passing on the costs to the consumers, this would increase the prices of the goods causing negative externalities and discourage them from being bought. If there is an over production in the goods due to negative externalities, it means (s) has shifted to (s1). Which results in too many goods being supplied out to the public. The prices are also very low which makes it easier for them to buy goods, especially those with lower income. At the point the social cost [s1] is not taken into account only the private cost is.
For companies with constrained resources, offshoring also offers better utilization of capital investments through remote usage in multiple time zones. The key to offshoring success is to exploit its advantages through a well-planned and articulated proposition that looks at the business from multiple dimensions, rather than as a simple cost-reduction exercise. As Franklin D. Roosevelt once said, "The only limit to our realization
How has technological innovations affected your organization? Technology impacts the cost of production. Technology helps in lowering the cost of production and making economies more efficient – producing more outputs with the same number of inputs. Producers learn more about various aspects of production in which they specialize, and this attitude of them leads to more production. Innovation impacts the cost of production as well.
What are the possible advantages of investing in the R&D center for advanced technologies? Discuss the implications, considering the changing perceptions and demands of consumers. The possible advantages of investing in the R&D center for advanced technologies are: improving profitability, differentiating from competitors, improving the quality of products, getting products to market more quickly, anticipating changes in the market (e.g. obsolescence of a product) and strengthening the brand. Through R&D, production costs can be significantly reduced to offer competitive pricing and/or increase profitability.
Do you think Altera’s new strategy will be successful? What are some advantages and disadvantages of the new strategy? Yes, I think their new strategy will be successful, because their new strategy offsets some of the risk associated with carrying too much inventory, since they only build finished products to customer orders and build die banks to stock. The intent of this strategy was to improve visibility into customer information, inventories and build plans, facilitate product development collaboration, and improve Altera’s inventory management. This allows them to reduce safety stock levels and inventory holding costs as well.
On the positive side, industrial regulation helps to pass on to the consumer the savings that monopolists enjoy as far as cost reductions while also preventing the restrictions on output and higher prices that are typical of an unregulated monopoly. Additionally, in cases where competition is not practical, a monopoly is encouraged so that consumers can benefit from the low per-unit costs, so long as the monopoly’s prices are regulated (McConnell, 2011). Some negative aspects of industrial regulation are the costs and inefficiency associated with it, and that it can also form a perpetuating monopoly, where a monopoly continues to exist much longer than a natural monopoly should. 3. Explain the entities affected by industrial regulation in terms of market structure.
Income tax changes affect aggregate demand in various ways. If people had higher disposable income as a result of low income tax rates aggregate demand would increase. When aggregate demand increases firms would have to invest to meet it and this in turn leads to an increase tax revenues. This suggests that low income tax rates are important because they allow for wealth to be created. With increased wealth an economy is more likely to grow because consumer expenditure will increase a large component of aggregate demand.
Investment projects, via the multiplier effect should result in an increase in the GDP of the economy; However in order to undertake investment, there must a high savings ratio must be obtained as it is essential for the accumulation of capital. Labour plays a critical role in achieving economic growth. The higher the number of workers there is in an economy should lead to economic growth. If there are more people working and unemployment levels are relatively low, then there is likely to be the achievement of economic growth as human resources
A higher sales revenue will occur for etisalat which means the income the company receives from business activities, usually happen from sale of goods and services to customers. Etisalat will also have more opportunities to invest in upcoming projects. If the opposite occurs and etisalat has low availability and higher costs it would mean, people spend less on their goods/services which would mean there’s a low